The deal comes less than a year after JM Smucker acquired the sugar-free and specialty cookie brand as part of its $5.6 billion acquisition of Hostess Brands last fall, which the company reported in August delivered lower than expected net sales during its first quarter.
At the time, Smucker leadership attributed the underperformance to a slowdown in the convenience channel and consumers being more “selective in their spending” in the current inflationary environment, but it underscored its optimism for Hostess Brands.
JM Smucker reiterated its commitment to Hostess Brands this week when it announced the sale of Voortman, noting in a statement that the divestment “is an important step in our integration plans that will enable the execution of our Sweet Baked Snacks strategy through dedicated focus and ongoing investments in the Hostess brand.”
It added it recently completed the “systems integration” of Hostess Brands earlier this month and Hostess “remains on track to achieve expected synergies of $100 million from the acquisition by the end of fiscal year 2026.”
Recent divestments include snacks, pickles and pet food
The divestment of Voortman is the latest in a string of brands that JM Smucker has shed in recent years, including the $34 million sale in late 2023 of the Seattle-based nut and trail mix brand Sahale Snacks – also to Second Nature Brands.
Both deals included all trademarks and the transition of employees associated with each brand – 300 in the case of the Voortman sale and 100 in the case of Sahale Snacks.
Likewise, in each deal, Smucker agreed to lease to the associated manufacturing facilities to Second Nature Brands. In the Voortman deal, Smucker will lease its Canadian manufacturing facility in Burlington, Ontario, and in the Sahale deal it leased its Seattle-based manufacturing facility.
Beyond the sweets and snacks segments, Smucker closed the sale of its Bick’s pickles, Habitant pickled beet, Woodman’s horseradish and McLarens picked onions brands to Treehouse Foods for about $20 million in cash in January.
In early 2023, it also divested several pet food brands, including Rachael Ray Nutrish, Kibbles ‘n Bits and others to Post Holdings.
Smucker has ‘lines in the water’ for future acquisitions
Smucker is just as interested in acquisitions as it is in divestments as it reshapes its portfolio, according to leadership.
In late 2023, JM Smucker CEO Mark Smucker said the company is “very interested” in acquisitions and has “lines in the water.” He added acquisitions “will continue to play an important role in our growth story over time.”
Indeed, beyond the massive acquisition of Hostess Brands, the company said last winter that it is exploring potential acquisitions in the at-home coffee category – an area in which it is investing heavily through brands including Café Bustelo, Folgers and Dunkin’.
